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All right, everybody, welcome back.
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It's another episode of All-in podcast, the podcast that is racing up the charts despite the fact that we recorded every three or four weeks.
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There's no marketing, there's no ads in this podcast.
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It's just four friends who play poker together who've decided to talk about the most important issues in the world.
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Welcome back to the podcast, David Friedberg, the queen of quinoa himself, obviously climate.
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com Eatsa and an undisclosed beverage startup that I'm not supposed to talk about. I'm sorry about that.
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I know a lot of people were tweeting about this beverage startup.
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You're still not ready to talk about the beverage startup. Thank you, J Cal. Yeah.
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Welcome back to the show.
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always appreciate your promotions.
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But when when will the beverage startup do you guys want to talk about Do you guys want to talk about Jason's home address?
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Cuz I have that, I think. Please no.
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I want to ask, is is that a picture in the background?
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I love space, by the way, as you know, but is that a picture of Uranus or what is that picture? I think that's Saturn. It's Saturn. It's Saturn. It's not your Saturn. It's no, it's Saturn.
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Uh Friedberg, obviously taking the first Virgin Galactic flight.
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Chamath Palihapitiya, of course, with us here, the prince of SPACs calling in from an undisclosed location that is not burning down like the United States.
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How you doing on your vacay? Uh doing really well. Thanks.
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Thank god I'm giving you the three-button salute, as I've told you.
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Yeah, thank god the microphone is perfectly positioned so we do not have to look at your chest hair.
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All six of your chest hairs. Oh my god.
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It's like a thousand-dollar suit that's missing all of its buttons or or shirt, rather.
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I mean, they couldn't afford to put buttons all the way up on your like probably two-thousand-dollar shirt. Austerity measures.
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When I get back to the United States, as Jason said, my haberdasher will meet me at plane side and sew the three buttons on.
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Yeah, when he when he leaves for Europe, they remove the three buttons.
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He comes back, the haberdasher puts them back on each shirt.
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He does that for the entire wardrobe.
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And, of course, chiming in is Rain Man himself, David Sacks, professional blogger and the the fund manager of Craft Ventures of course, before that working at PayPal with Peter Thiel, Elon Musk and a bunch of other famous people, two of which have gone on to have demonstrably more success than Sacks, but Sacks having, of course, more than success, demonstrable success than the other 72 rocket scientists from PayPal.
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In between, he did a little company called Yammer which Microsoft bought for a billion dollars.
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Speaking of big companies and big tech we had a big tech hearing this week and Jeff Bezos Sundar and Zuck himself as well as Tim Cook, two founders and two hired guns, people who were hired for their positions, defending themselves from what I thought was some pretty good questioning.
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My My expectations were very low that anybody on that panel would know what they were talking about.
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For me, I thought Jeff Bezos did the best job.
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He had a great opening statement and he was the most candid and I think least likely to get broken up.
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Going around the horn here, Chamath, who did the best job in the hearings?
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I don't know if you saw all of them or just clips, but who do you think shined?
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I I only saw, to be honest with you, your recap, which I thought was frankly really, really good.
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And we should we should probably link to that in the show notes so people can listen to it.
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I saw a couple of answers.
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Um The the thing that jumped off the page to me was I I read a little bit of Bezos's statement.
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I thought it was pretty fire.
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I thought he did the best job kind of positioning himself, but the reality is, you know, it's kind of what I said a few days earlier on CNBC, but I just thought going in, this whole thing was set up to be kind of performative theater and it basically was that, you know, the the just like the level of questions are just so poor, the level of understanding is so bad, and then, you know, people just use it as a way to grandstand. And everybody did.
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So, you know, I wasn't completely blown away by any of it, to be quite honest.
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What do you think, Friedberg?
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Who had the best showing in those hearings?
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I think Zuck was the most kind of eloquent in the on-point responses.
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He was uh super super well prepped for this thing.
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I think Bezos and and others were obviously uh you know, they had they had great kind of prep work done for their statement but in terms of like warding off the attacks, I think Zuck did did a great job. You know, it was weird.
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It didn't feel like like Tim Cook should have been there.
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It was like kind of a random thing that he was there because everyone had an axe to grind and the axe that everyone had to grind was a little bit different.
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It wasn't like this was a a true objective discussion about, you know, antitrust.
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And so the the axes people had to grind were kind of pointed at Google and Facebook and Amazon in different ways.
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Tim Cook was kind of, you know, hey, yeah, this is cool.
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You guys go ahead and give your responses.
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I'm going to go back to work.
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think that's because Apple does not have a monopoly position on a on a numbers basis in anyone era and or and and or because their products are so loved and universally, you know, used Well, I I think it's actually a function of what these companies do.
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So, if you look at the Jim Jordan rant, I don't know if you guys watched this, but Jim Jordan did this big rant at the opening. And he went on and on.
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And the first thing he said, he's like, "Big tech is out to get conservatives."
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And then he went on and gave all these examples about how Twitter has been pulling down Donald Trump's tweets and flagging them and and Facebook's been been, you know, canceling certain people on the platform.
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And his whole axe to grind was really about censorship on social media platforms which has [ __ ] nothing to do with antitrust and has nothing to do with Apple's business.
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And so, yeah, I guess my point is like And then other people have issues with with the with Google's dominance in ads and Amazon's impact on local business.
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And so there there wasn't much of an axe to grind, frankly, with Apple.
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At the end of the day, as I said, I just don't think that it was a function of, you know, a true kind of objective antitrust approach and it was just more about like, "Hey, we've all got different things we want to address and we finally got these guys here. Let's beat them up." and you know.
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Sacks, what do you think?
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Were you you with Friedberg that it was performance art or do you think that or performative, rather?
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Do you or do you think that there are actually substantive issues that came up during the hearings that we should discuss here?
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Well, you know, it was both.
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Um you know, certainly there was a tremendous amount of grandstanding and political theater and the politicians on both sides wanted to take shots at at the companies for various reasons.
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I mean, I think they have a slightly different hierarchy of hate.
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I think the the left sort of hates Facebook the most because they blame it for Trump's election, which I think is kind of a ridiculous scapegoating, which we should talk more about.
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But and then I think the right is is most suspicious towards Google.
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Um But I think there are, you know, legitimate issues here as that were brought up and I I think the congressional hearing did score some hit points.
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And I think your your previous pod did a good job showing some of those.
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The these hearings were teed up apparently over the past year by a series of subpoenas of records that the the committee, this is the This is the House subcommittee on antitrust had teed up.
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And so there were some moments where I thought that um you know, the the representatives scored some hits on, you know, Facebook and Google.
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Um What do you think the big Who took the biggest hit in all of this?
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Who Who Who do you think has the most Putting aside all this performance, obviously, and the politicization of everything in our country and Jim Jordan, who to me is like the He's like the dad at the baseball game who like the little league game who runs on the court and pushes the umpire and gets banned for the season.
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Like he just yells over everybody for no reason. Right.
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But what is the actual What was the punch that landed that is the most valid as we go around the horn one more time here now that we got our initial thoughts about it.
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What punch landed the squarest in one of these companies' faces?
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Well, I I I Let me Let me set this up.
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I I think there were three big areas of concern where just about all the companies, with maybe the exception of Amazon, took hits.
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Although even, you know, Bezos took hits.
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I think one is with respect to anti-competitive actions that these platforms are taking, particularly with respect to the applications for small businesses that operate and are dependent on those platforms.
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I think all of the companies were interrogated about that.
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You know, Bezos took a hit when he had to admit there were concede that the company may not have always followed its policy with respect to using its you know, third-party sellers' data to to figure out how to compete with them.
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You know, Google was interrogated about snippets.
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There was news today actually just out of Australia that the government's going to order Google to pay small businesses for the use of its its content for snippets, which you know, so so the the regulations are kind of heating up on this.
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But the the sort of the first area was sort of anti-competitive.
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And I think Facebook took some some hits with respect to the Instagram um which you know, Congressman Nadler really went after him.
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And then I think um uh Jayapal as as well.
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And that that's a tremendously threatening issue for Facebook because if it is forced to divest Instagram, it would just be crippling for for the company.
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We'll talk more about that.
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Yeah, let's take let's But but just to just to Jason, to set the table, two other issues that I think came up, I'll just very briefly.
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The number two is sort of cosying up to China.
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I think Google is the one that's most vulnerable here.
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And then the third issue is sort of this issue of censorship and bias uh with respect to content and and politics in the election.
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do with which has nothing to do with antitrust, the censorship issue.
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So, let's table that one that one.
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you're hitting the nail on the head.
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This is not about antitrust going in.
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I think people were, you know, kind of confused.
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Even Jim Jordan just I don't think he has any clue what he's talking about.
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He doesn't know the difference between regulation and antitrust.
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He doesn't know the difference between the Sherman Act and like, you know, section 230.
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I think they're all kind of making it up as they go along.
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So, in many ways I think, personally, that the companies that were the most at risk going in were the same companies at risk coming out.
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And so, you know, if you had to stack rank risk, I think Facebook is number one at the top of the list.
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Then I think it's Google. Then I think it's Apple.
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And then I think far, far, far down is Amazon.
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In many ways Amazon is the most inoculated simply because the end market that they operate in is so massive.
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Um and the the market that Facebook operates in is so new yet so constrained with very few competitors.
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So, in many ways I think that's how the risk cuts.
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I really think that the antitrust legislative framework that existed isn't enough to touch any of these guys.
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Instead, I think what really happens is more regulatory.
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Um and if you really think about what these guys are very concerned about, it's more that Facebook, largely, and then Google to a smaller degree, essentially can be kingmakers with respect to popular opinion and sentiment.
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And I think that they want to have regulations.
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And I think that there's a good historical precedent for a bunch of industries um that have had to come under regulation when they effectively get to 100% distribution.
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You know, whether it's meat or airplanes or radio or television, you know, agriculture writ large um uh automobiles and transportation, whenever a market basically serves 100% of the total addressable universe, government step in and they don't necessarily legislate and trust bust, they fundamentally regulate and tax.
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And I think in many ways that's just as bad and frankly in some ways it's worse because if you do that to a tech company, you're basically crippling the one thing that they're supposed to be very good at, which is to innovate.
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And that's the only thing that they can use to basically keep their stock price high, which is then the only thing that they can use to get people to continue to work for them.
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So, that's the sort of circular loop that breaks if you regulate them.
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And I think that the risk coming in was the same as coming out.
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So, Facebook let's let's take them let's take them one at a time.
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take them one at a time. Facebook I thought had the worst performance because it was pretty clear that Nadler was setting them up not only to not be able to buy a company in the future, but in that clip he was sort of teeing them up that maybe the Instagram
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uh acquisition should be unwound and they should be forced to spin that off uh because they were saying over and over and over again that Zuckerberg put in emails uh with his management team that they were going to buy these companies or kill them or copy their feature sets. And even though that may
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And even though that may not be explicitly illegal, the fact that they've hit as uh Chamath is talking about such incredible market share with billions of users and because of the track record of Zuckerberg, you know, which may not be at all related to this, but it sets the table.
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No, but Jason Jason, in fairness to Mark, that decision wasn't made when Facebook had market dominance.
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Um that decision was made when Facebook was still fundamentally at risk and there was a large period of time where a lot of other people, had they been left to their own devices or properly capitalized, could have actually become a relatively you know, important competitor to Facebook.
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Instagram could have been at that point, but then Snapchat was the opposite.
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Snapchat they were at scale and then they were going to buy it and threaten them either you sell to us or we're going to copy the features.
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I think I think I think what a more logical and defensible reaction it it like I I just think it's not defensible to say, "Oh, you know what, Facebook, I didn't like the acquisition you did 10 years ago basically because it worked.
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And so, I'm going to punish you 10 years later." That's crazy. That's stupid.
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In the rearview mirror, no no good. Yeah.
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A more reasonable place to be is to say, "Okay, this thing, meaning communications writ large, has become a critical piece of societal infrastructure and we are trying to figure out now what the rules should be.
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And rules shouldn't be brittle.
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Rules should be evolutionary.
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They should map, you know, to the moral decisions and ideas and frameworks of the time.
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And so, you know, uh we have to figure out, for example, number one, interoperability.
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So, how can you message across all these multiple networks?
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You know, another simple example, uh you know, we legislated the ability for emergency services to be able to send a message on your mobile phone line and your landline.
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You should probably be able to have a backdoor into all the messaging networks simply for that reason.
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So, the point is that, you know, there are all kinds of things you can do today to make this infrastructure layer of society operate in a more predictable way on behalf of What was your best You have a Have you thought about a regulation, and let's stick to Facebook and then we'll go to Amazon.
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Chamath, have you thought about a regulation that would make sense to Facebook, whether it's divesting an asset or maybe a certain percentage of usage or allowing Facebook Messenger to work with iMessage to work with, you know, Twitter DMs?
15:40
I'll answer it in a different way.
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So, look, I mean, for 20 years I've run these kind of businesses.
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Like from from Winamp to AIM and ICQ to then, you know, at Facebook.
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And so, um you know, I remember in at AIM and ICQ, we, you know, did all this hand ringing and all these meetings between us and Microsoft and Yahoo to make our messaging networks interoperate.
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And, you know, eventually we were basically just cut off at the knees because other people just moved around us and eventually it all just morphed anyways away from uh these sort of brittle messaging networks.
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My my kind of view is that I don't I I think what's best for Facebook is a status quo.
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And so, you know, uh if if if if they can basically And by the way, I think the strategy is and and Mark wrote this in his manifesto, but a couple of years ago, you know, this is sort of what led to Chris Cox resigning if I'm playing, you know, sort of like conspiracy theorist.
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If you read Zuck's manifesto, what he was basically saying is, "Listen, we're going to take all these product and we're going to take all that code and we're going to mesh them all together in such a complicated, convoluted mess that if and when somebody ever tells us to rip it apart, it'll take another five or 10 years to do it."
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And that's effectively the technical read on that manifesto.
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It's just like you're going to make it technically impossible to uh unthread these things as independent entities.
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and your the thesis is that's a strategy against an antitrust breakup.
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I I I I find that I know, I just think it's a really smart strategy.
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I mean, he wrote it and he published it online.
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So, it's not like he's hiding anything.
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He made it I mean, it's just the beautiful part about it.
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He made it completely in the clear.
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Now, uh so, that's that's the strategy is to basically make it one monolithic code base.
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So, that if and when I think I don't I'm not sure if this is the intention, but frankly, if and when somebody knocked on the door and said, "Hey, you need to strip apart WhatsApp and Messenger and Instagram," you can say, "Well, look, it's it's one monolithic code base of, you know, 50 million lines of code.
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It'll take me 10 years, but sure, I'll figure it out somehow."
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So, you know, I think what's good for Facebook is a status quo.
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Now, that's different from what's good for politicians and then what's different for consumers.
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I think what's good for consumers is fundamental interoperability.
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Now, this is then what touches, you know, Android and Apple as well.
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Like the idea today that you cannot have a group text message that can only include iPhones, you know, on the off chance one of your friends has an Android phone, you're basically [ __ ] It's kind of crazy. 6 months on our group.
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That Freeberg, what do you think uh in terms of Facebook and any potential action that could be taken or any possible solution to them having such a dominant position?
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Cuz they are the only one of the four that has a dominant position.
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I would think about the um uh you know, how these businesses are are kind of built, right?
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There in all these businesses, there's an infrastructure layer.
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The infrastructure layer in the case of Google and Facebook is is is reasonably similar.
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It's it's a bunch of data centers and and hardware and software infrastructure to run all of their services on top.
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And then on top, there are uh consumer products.
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And then there are advertising products in the and the customer base for the consumer products is obviously users and the you know, customer base for the advertising products is these advertisers that pay to access these consumers and give them ads and get clicks from them and sell them stuff.
19:07
Um And and so, if you think about what do you pull out, um it it sounds like on the Google side, there's um there's there's concern both on the advertising and on the consumer products that are being offered and the scale and the leverage that Google has and how they make those products kind of come to market.
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Um and with Facebook, it's really about this absolute kind of monopoly on um you know, on social products and services, whereas Google's got this great monopoly on on search products for consumers.
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So, um you could kind of take a layman's view and say, "Hey, like rip out WhatsApp and rip out um uh Instagram and, you know, then Facebook is good."
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But, the problem is in that infrastructure layer, they've created the social graph and this connection between, you know, all the people that you know and they've got all this stuff sitting on the same servers and Chamath points out all the same code base and there's a lot of commonality there.
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there. So, the reality of like ripping something out from there is a lot more nuanced and a lot more challenging than just saying hey you got to get rid of WhatsApp or you've got to get rid of Instagram and it's more likely some sort of
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Chinese wall situation where you end up with a a negotiated exit, continued ownership and control but you know almost like what happened with the banks in the 80s if you kind of got to separate one side of the business from the other. That could be one way that
20:22
That could be one way that this goes because you know it's really hard to kind of break apart given the way that these businesses are built.
20:29
What do you think about a solution David in which they conceded hey we're not going to buy any more of these competing social networks which I think would be kind of hard for them to buy one right now. I think that's done.
20:40
I mean like you can even see that Google Fitbit.
20:44
I mean Fitbit is you know what is it a 1.
20:46
2 or 3 billion dollar acquisition?
20:48
It's going to take almost 2 years to close and Google's already making concessions, antitrust concessions to the EU. Right.
20:53
For you know this is a 1 trillion dollar company trying to buy a 1 billion dollar company.
20:59
So, I think large acquisition and M&A by the big four it's impossible.
21:05
Is that good for society Chamath or bad for society?
21:07
Is it good for our business of investing in startups or is it bad for us investing in startups?
21:12
Well, I I think it's good in one very important way which is that it forces the capital markets to support these companies and what I mean by that is you know I I I told you guys a couple times but in the year 2000 there was 8000 public companies.
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In the year 2020, July 2020 as we sit there, August 2020 there's about 4000.
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So, we've seen a shrinking of 50% of the number of public companies.
21:37
So, the idea that there isn't an M&A on-ramp anymore means that more capital and the capital markets will become more fluid and we will support emerging growth companies in the public markets is my suspicion.
21:50
If only there was yeah if only there was an easy way for these companies to get public. Go ahead David respond.
21:57
Well, I I was I mean I I I think that um I I think you're raising the right issue which is um the chilling effect on M&A that these hearings are going to have um even if Facebook is never broken up or or that deal is sort of retroactively challenged um the the the big four tech companies have to be looking at these
22:18
hearings and now they're going to be second-guessing every acquisition they want to make and it's going to have a chilling effect and I I think that's a disaster for Silicon Valley um because we know that most of the startups don't work um and you know uh and there's really only you know most of them go out of business and there's only two good exits. One is an IPO, the
22:35
One is an IPO, the other is M&A.
22:37
And if you take the M&A exit off the table because it's no longer sort of feasible from a regulatory standpoint um not all those companies are going to IPO you know.
22:49
what you what you're saying doesn't make logical sense because if those companies are [ __ ] anyway they should be going out of business and who cares about an aqua hire or some mini modest hire that gets you two times your money?
22:58
There's a lot of acquisitions um where the acquirer is picking them up because they provide an important component or technology or product but that that that startup would not have been a great standalone public company. be worth more today?
23:15
Would you be worth more money?
23:16
Would your investors be worth more money if Yammer had SPAC'd? Yes or no David?
23:22
Um I I I Answer is absolutely yes.
23:24
Okay, so David your your argument makes no sense.
23:26
I think you're playing to lose.
23:29
It's not that it doesn't make sense.
23:29
I think David David does bring up something that's important in the following way which is there's a lot of companies Jason that get to a certain amount of scale and then they basically start running out of oxygen whether it's because they've overbuilt or they've overhired or they've overspent or whatever.
23:45
no natural audience for the product.
23:47
Yeah, maybe but I think I think a lot of it is just sort of more overbuilding and just kind of distracted capital allocation.
23:53
But then you know you need somebody to come in and this is the problem with Silicon Valley and I think what David speaks to is the following.
24:01
If big tech M&A is off the table the single biggest thing that'll change is valuations by late stage private late stage privates.
24:11
Because if you know that you can't get a 2x mark-to-market from the last post guess what'll happen to your post money? It'll go way down. Right?
24:17
Because that was always the biggest assumption.
24:19
You know all these guys these late stage money can come in and say well sure I'll put you know two and a half billion dollar post, a 3 billion dollar post because in their mind what they've been taught is that immediately sets the mark to get acquired as 2x.
24:33
And in many ways Facebook started it because Facebook came to buy Instagram literally weeks after that growth stage round at 500 million and that's why they paid a billion one.
24:44
They doubled the valuation.
24:44
But wouldn't it hold on a second?
24:45
Wouldn't it be healthier though for the entire ecosystem if we weren't building those late stage companies to be flipped to a major company, maybe merging them with medium size companies or slightly stronger and then taking them public to your point Chamath?
25:01
My point is if you don't have a [ __ ] up cap table you can do all of those things.
25:04
It's the [ __ ] up cap table that prevents that.
25:07
Who needs this late stage capital coming in and doing these fakaka crazy rounds?
25:11
Why not take the companies public earlier?
25:14
Well, because look you don't always know what's going to happen.
25:17
I mean this is the reason why Instagram sold, is the reason Yammer sold is you don't know exactly what's going to happen.
25:23
You don't know what the outcome's going to be.
25:24
And in a lot of those cases that you're saying what would become IPOs if they weren't acquired well a lot of them just you know aren't going to work.
25:33
It's it's crazy to be taking those exits off the table when both the startup and you know the acquirer or the big tech company you know want to do the do the transaction.
25:42
Um and and and and and one of the reasons why I think these you know there are a lot of these M&A type outcomes is because big companies have realized they're not very good at R&D, at sort of good at sort of new product development.
25:55
And so what they've done is they've outsourced a lot of their R&D budgets to M&A.
25:59
And so they let the startups run the experiments you know in any category in any new area you end up having a dozen of these startups get funded.
26:08
You know we we make fun of it because they're all you know there's so many competitors in every little space but those startups are the laboratory where all these experiments are taking place and then you know the big company comes in at the end and sees which experiment did well and they acquire it.
26:24
I think it's I mean I think the advantage of being a platform business is you can plug something in and immediately gain a lot of scale from it.
26:31
So, I mean you know Instagram and YouTube are perfect examples.
26:34
They were you know reasonably fast growing, had millions of users um but once they were plugged into the engine of the bigger platform they were worth 100 times as much over a few years because of all the usage and the infrastructure and the and the distribution etc. that was provided.
26:54
Um but you know it looked insane at the time to pay a billion dollars and a billion six for those two businesses.
27:02
Each of them are easily worth 100 billion plus today probably some multiple of that.
27:05
Um and so I think it's Zach's point is right is like I'd rather as a look I worked in M&A at Google for a couple of years early in my career.
27:14
I left Google in um in 2006 and a lot of the infrastructure that makes Google's you know revenue engine was acquired.
27:23
You know we bought a company called Applied Semantics for 100 million bucks or 100 something million dollars at the time um which ultimately became AdSense.
27:31
And Applied Semantics could scan a web page and basically determine what keywords that web page represented and then match ads from AdWords onto that that web page.
27:41
That acquisition was 100 million dollars.
27:44
I mean I don't track anymore how much but tens of billions of dollars of revenue are generated by that uh you know by that AdSense system today.
27:52
You're bringing up something really important which is at the time Google was not a trillion dollar company.
27:58
So, the point is that Google had access to enough capital market scale where you know nobody's going to get in the way of a 5 10 20 billion dollar company trying to buy a 100 million dollar business like that.
28:10
I just don't think you're going to see you know any regulatory body take that seriously.
28:15
Wait, so didn't we just paint the perfect picture Chamath? a trickle down.
28:17
Wait, wait isn't that the perfect picture No, no in picture I think what it means is the 20 billion dollar company now probabilistically can actually win.
28:22
So, for example like look look at this Intuit Credit Karma transaction, right?
28:29
The question is you know could a smaller company have bought Credit Karma?
28:33
Probably but not at the price that you know Intuit is willing to pay.
28:35
Now, if Intuit gets big enough where there's a chilling effect and regulators say okay you know you're above a magic threshold and you know no bueno on the M&A anymore.
28:45
Now Credit Karma has two choices which is maybe they sell for 4 billion to a very different company, right?
28:51
Um or maybe they sell actually let's take a different example. PayPal.
28:55
PayPal is now a top 20 business in America, right? By market cap.
28:59
So, if PayPal isn't allowed for example to buy you know a bunch of sort of like you know payment rail payment companies.
29:07
Um maybe what happens is like a you know a medium tier business is allowed to buy them.
29:12
And now all of a sudden those medium tier businesses can compete with PayPal.
29:15
That's what I think that's actually seems like the best solution that we've we've kind of stumbled upon here.
29:19
Can't Slack then become or Dropbox or Uber or any Airbnb?
29:24
Now they can become the acquirers of these companies and then they can compete.
29:28
So, why don't we just say hey if you're over a trillion dollars or if you're over 500 billion you can buy 1% of your market cap.
29:33
I'm just throwing a number out here.
29:37
Jason let me jump in on this.
29:39
That's not what Nadler was arguing for.
29:42
You know it's not like Nadler was saying that if you're a big four tech company you can't do these deals, but everyone else can.
29:48
The the the the the standard that that Nadler and the precedent that he was essentially setting in that hearing is, you know, 20/20 hindsight bias.
29:58
You know, if if a company acquires um Yeah, but putting Nadler aside, I agree with you on that, but putting that aside, if we were going to come up with a rule, cuz we know the rules that as they currently exist are inadequate to do any type of regulation for these companies, cuz none of them have 95% market share.
30:14
So, if in fact uh we we need a new solution.
30:19
How about this for a solution?
30:21
I'm just putting it out here.
30:22
You can acquire something that is under 5% of your market cap.
30:25
So, if your market cap over the last year is a billion, you can buy something 50 billion or less.
30:30
If you're uh under 500 If you're under 250 billion, you can buy whatever the hell you want.
30:37
But, Chamath, let me let let me let me ask this question.
30:39
You know, the the points we made earlier about YouTube and Instagram, they were successful because of the scale of the user base of the platforms that acquired them and the work that had already been done, and so they could plug in been totally successful without have been successful, but would they have been worth $300 billion like they are today? It's unclear. more.
30:56
But, Instagram was 13 people, YouTube was a couple dozen people. It doesn't matter.
31:01
The story is a small group were brought in with with an interesting platform that was kind of working at the time, and then they became these $300 billion platforms. So, that's one scenario.
31:08
And a lot of money could be used and Google and and Facebook used a lot of money to be the best acquirer and to be able to acquire those businesses, and that's the argument for this Hey, they're at such a scale right now, no one else can compete because only they can pay this this fee, as Chamath points out with Intuit and Credit Karma.
31:26
Only Intuit can buy Credit Karma at that price.
31:28
Now, the alternative way to think about this is what if there's vertical expansion?
31:32
So, instead of leveraging their existing platform and their existing dominance, what if Google in this case is trying to get into the cloud business, right?
31:38
And they're competing viciously with Amazon and Microsoft and others in this enterprise cloud business marketplace that is continuously evolving, changing every year there's a different kind of lead and a and a different company that's suddenly growing faster than the others. And Google spent $2. 6 billion to buy Looker. Buying Looker for $2.
31:56
6 billion does not advantage Google's advertisers, it does not advantage I mean, to some degree it might, it does not advantage Google's users, and it is not about platform dominance in their traditional ad business, it's about vertical expansion into a new market.
32:10
Okay, so here's how I'll rewrite the law, David.
32:11
If you have over 70% market share in your vertical, you cannot make acqui- additional acquisitions in that vertical.
32:18
If you have they're buying into a new vertical, right? That's my point.
32:21
so then the caveat is, if you're buying into a new vertical, you don't have to hit that cap. already have that.
32:26
We already have I mean, that that's that's basically the the way the the rules work today is that you look at market share.
32:32
I mean, Coke cannot buy Pepsi, Facebook cannot buy Twitter today.
32:37
Um but, what we're talking about is at a much earlier stage, are you going to interfere with the M&A, or are you going to retroactively go back and unwind these transactions? makes no sense. Yeah.
32:48
I think the point is this is all water under the bridge, and but the incremental M&A for these big guys is uh very unlikely.
32:57
Now, David does bring up a good point, unless it's in basically a, you know, do nothing, not at that important, you know, in in the positioning uh category relative to the core business.
33:10
And so, this is why, you know, it's again, go back to like why did Looker close faster than Fitbit? It's half the price.
33:22
Looker's twice the price, right?
33:22
Fitbit is half the price.
33:24
Yeah, new mark- new market completely. Yeah.
33:27
Yeah, and so so there is a fear that there is going to be a compounding advantage that regulators have a responsibility to stop.
33:33
So, I think it goes back to um once you get to a certain level of scale, the thing that we're missing with online businesses is this kind of like, you know, there's like a there's like a great original sin here that we're not admitting, which is that the internet is now a pervasive and critical part of human infrastructure.
33:56
As such, there needs to be people that regulate and manage the internet the same way the FAA manages and regulates planes and wind turbines.
34:04
Like, think about the FAA, let's just take aviation.
34:08
It is impossible for you to go and just go into your garage, build some random thing to carry people from point A to point B in the absence of some certification. Okay? Take agriculture.
34:20
It is impossible for you to basically go and like build up a farm and build up, you know, uh livestock or whatever, and all of a sudden just supply it into [ __ ] Sobeys and Safeway without any sort of like checks and balances.
34:36
Similarly, and the reason is because it's simple human infrastructure that everybody relies on.
34:39
And and I just think that we have to admit that now the internet company also those are life and death. This can be, too.
34:46
I mean, like what about the guy that read the post about like the pedophiles in the pizza joint, came up with an AK-47 Yeah, I mean, it's quite an edge case compared to flying on a plane.
34:57
This stuff is life and death at some level, but even more than life and death, it's the anointing of power that then determines life and death.
35:05
That and that's I think the key is that it's power. Yeah.
35:07
Chamath, do you think that there should be an internet regulatory body that decides how businesses operate and how content is censored and and managed on the internet?
35:16
Is that what you're kind of suggesting?
35:17
Yeah, so let me be very specific.
35:19
So, I think that there are very specific kinds of businesses um and business models that should be overseen.
35:28
Specifically, I think the first and most important thing is a body that oversees the collection of user data and how it drives targeting and identification.
35:41
So, privacy concerns around that.
35:41
That's a that's a no uh brainer. Um that's the first one.
35:45
And then I think the second one is something that essentially tears the fig leaf off of internet companies and says, you know what?
35:54
You are the equivalent of a publisher and a platform, some weird hybrid that we didn't think could exist when we wrote these rules, and so we're now going to adapt these rules.
36:04
Because, you know, if you think about it, nobody is happy with the internet publishers today.
36:08
You know, the the left thinks that it skews right, the right thinks it skews left.
36:12
Everybody's confused, nobody gets what they want.
36:13
Um and so I think somebody has to step in and kind of sort it out.
36:18
think this is a good segue to Sach's point, and then I guess we we have we have a fork here now in the discussion.
36:23
Do we want to go and talk about censorship and that specific issue across Facebook, or do we want to get into Amazon for a second?
36:32
Which way do we want to go, Sach's? Go to censorship.
36:35
Well, okay, Yeah, we can we can talk censorship. I mean, fence here.
36:38
Should there be to Chamath's point, Sach's, a regulatory body that decides what people can and cannot say on social networks? Yes or no?
36:51
No, I mean, let's think about that.
36:51
What we're saying is we need the the politicians to set up a regulatory body to control how the people talk about the politicians.
37:01
I mean, that seems like a recipe for disaster.
37:04
What about specific lies and intentionality to um frame uh debates incorrectly?
37:14
That's not what I'm saying.
37:14
That's not what I'm saying.
37:15
I'm saying like like you go to a movie and, you know, there's a little blurb here that says who can go to the movie and who cannot.
37:20
Um you know, you get a you buy an album and it tells you whether there's explicit lyrics or not.
37:26
Like, you before you turn on the TV, there's like some rating agency that tells you whether your kids should be watching it with you.
37:31
My my point is, what is the equivalent version?
37:35
We all need to think about what it is, but to say that there should be nothing, I think is crazy. Sach's?
37:40
Well, well, I think um You so I mean, the those ratings are mostly about um you know, uh standards related to to kids, you know?
37:54
And um the big internet companies already have a lot of child safety features.
37:58
I don't know that you need to create laws around that.
38:00
Um and I and I don't think that's what we're talking about anyway.
38:03
I mean, I think the big debate about Facebook or Twitter is whether they're engaging in censorship or bias, um right?
38:10
And that that goes way beyond um the this topic of of child safety.
38:18
So, okay, let's let's unpack I don't think that they're censoring.
38:20
All all I'm saying is I think you need to label and you need to be more clearly designate what this content is, so that people can choose.
38:28
Like, for example, on Twitter, you know, I follow a bunch of people on the right, I follow a bunch of people on the left, I follow one or two QAnon accounts, only because like I just want to see it all.
38:38
And then I want to judge, and I feel like if I can see everything, I can sort of like lay it all on a table and figure out where the rough center is and kind of move to that, you know?
38:48
So, you feel you're intelligent and mature enough to do that, Chamath, but the rest of the world isn't?
38:53
No, not really, but I try to do it because I think it's important for me.
38:57
Would you rather the platforms or some regulators come up with what you could say on those platforms, Chamath?
39:03
Again, not what I can see, but there has to be a simple way, for example, you know, you could have something and again, this this this all all this does is it breaks business models, which then breaks monetization and it breaks the market cap of these companies.
39:16
But, for example, let's just say you had a new kind of job, which was, you know, all these you had you hired 500,000 people, and these were a combination of lawyers, journalists, you know, uh academics, all kinds of random people, artists, everybody, okay?
39:33
Normal folks, blue collar folks, and you paid them full-time to basically read stuff and kind of like, you know, uh you know, wisdom of the crowd style, tell us where this out in the spectrum. Okay?
39:48
Uh this is on the left, this is on the right, this is kind of center, this seems laughable, this seems unbelievable, this seems relatively credible.
39:55
And I think that you would get, you know, very quickly, and I don't think the latency would be that high, but probably minutes, where, you know, 40 or 50,000 signals would tell you whether something is, you know, where something is in the spectrum of, you know, how to understand it.
40:09
And then that that system that system will get paid get get played, though, I don't get gamed, right?
40:14
Like someone will figure out a way to turn all of Chamath's tweet labels into super evil tweets, and you know, now and everyone will mute you cuz you're super evil.
40:22
Yeah, I think we just defined George Orwell's 1984.
40:24
Like Or cancel culture, right?
40:27
Like If you pay 500,000 or a million people, if if Facebook and Google and these guys come together and Twitter, and they pay a body of people to do this work, um and so you don't know who posts it, you just see the content, you read it, you label it, it's a classifier.
40:40
So, Chamath, what what what do you think what do you think you would get classified as?
40:43
And then what if you disagreed with what what what you were classified as?
40:47
So, but David, like what what I'm saying is you wouldn't know it's me.
40:50
Like if I wrote an article on Medium, right, and I wanted to publish it in Twitter, that article first hits a queue, 50,000 people read it, they human classify it, and then it gets published.
41:03
And now what if you don't like the way it's classified?
41:05
And you don't want those tags attached to it.
41:07
And you want to place to publish freely without classification without tagging.
41:12
Then there will be a company that supports that, too, and you'll see how much people care about that.
41:15
Yeah, I mean, I think the free market could handle what you're saying, Chamath, cuz that I think David's concerns would be the same as mine, which is who who's doing this classification, what kind of transparency is there?
41:26
And we already have the wisdom of the crowds, which is things that are outrageous automatically get pushed up on Twitter, which allows anonymous, and then Facebook seems to be all the top trends seem to be on the right.
41:37
Um let's swing over to Sachs.
41:39
Sachs, what do you think of of the 1984 proposal from uh Chamath of 500,000 sensors uh telling you what to think of a post before you read it?
41:51
Yeah, I mean, it's it's a it's a it's a the question, but it's an insane idea, Chamath.
41:54
It's it's a it's a little bit like uh Twitter fact-checking uh the politicians they don't like. The digital Politburo.
42:01
It's it's a it's a form of like soft censorship.
42:03
Um and, you know, I I I actually think that, you know, Zuckerberg gets attacked the most, but I think his position on speech actually makes makes the most sense.
42:16
I mean, it seems like what he said is we want to be a neutral free speech platform.
42:20
And, you know, whereas I think, you know, Twitter and um Snapchat, for that matter, are much more likely to engage in either uh you know, censorship or or fact-checking.
42:31
Which is paradoxical cuz Twitter's initial position, David, was it was the free speech platform.
42:38
And I totally agree with you.
42:38
I think Sachs's position is the most defensible, but it also is the most untenable because it's the most it's the it's the it's the least uh technologically and just socially palatable, but it is the most defensible and philosophically, in my opinion, the only position you can have.
42:53
But it's not it's not going to be what wins. Right.
42:55
Well, it's it's it's the reason why Zuckerberg is hated is because if you're going to defend defend the principle of free speech, you always end up defending speech that society hates.
43:07
You know, like the ACLU and Exactly. Exactly.
43:11
And and and so, you know, Zuckerberg I think has done the best job sticking to his guns.
43:16
I mean, the reason why Twitter is sort of uh you know, loved on the left is is precisely because they gave in to the mob, and they've, you know, they've started uh taking down accounts that the mob doesn't like or or or or or, you know, fact-checking them. Right.
43:32
Whereas I think, you know, Zuck and that and Zuckerberg's refusal to do that, and by the way, I don't think he's been like perfect in this regard, but he's been much better about standing up for the principle of free speech.
43:41
That's what's made him, you know, anathema to the left.
43:46
I think that and the fact that Facebook still gets blamed for Freeberger, I have two I have I have two specific follow-ups to what David just said for you, which is one, how much of this has to do with anonymity being allowed on Twitter versus not being allowed on Facebook?
43:58
And second, how much of it has to do with the fact that we have algorithms that trend topics.
44:03
If we didn't have those algorithms trending them, perhaps this wouldn't be an issue because if you wrote something that was inflammatory, it wouldn't and false, let's say, in that situation, both characteristics, it wouldn't go to the top of the list, which is what everybody's kind of upset about is that something that's false goes to the top of your feed.
44:23
Comment on those two issues.
44:23
Well, I think your second your second point's an important one, which is like social media helps to enhance the stimulation of the amygdala in the human brain.
44:33
Uh you know, you see something that makes you angry or something that makes you elated, you are more likely to engage with it.
44:39
If you see something that is kind of a rational discussion about something that doesn't incite emotion in you, you're less likely to engage in it.
44:46
And so, whatever the engagement model is, it ends up, you know, creating a lot more virality and chatter and and and kind of gets brought to the surface, and there's a lot that's been written and said about this that I don't think we're kind of uniquely in a position to to say anything more on.
44:57
Um and that's obviously what a lot of people are kind of concerned about is the inflammatory and polarizing nature of the content that is getting highlighted on these platforms and is getting greater distribution on these platforms.
45:10
And then I think your prior point, I'm not sure it's about anonymity as much as it is um uh about any form of censorship that ultimately can be viewed as biased.
45:20
So, Jim Jordan's points were actually, you know, as much as the guy rants and goes on and sounds like a guy running on the soccer field to punch the coach.
45:29
Um it's really interesting to hear the point of view that as a conservative, I believe that a lot of what Donald Trump is saying or what some conservative voices are saying is reasonable, and that voice should be heard.
45:40
that voice should be heard. And to hear over and over about Twitter pulling these things down, and then seeing a whole bunch of stuff like anarchists taking over Seattle and taking over Portland, and they don't get their stuff
45:50
taken down, you know, them claiming that they can hold down the streets of Portland and Seattle because that's, you know, the way that it should be, doesn't, you know, incite any sort of censorship, but Donald Trump saying he's going to end it incite censorship. Um
46:01
Um and so, I think it's not as much about anonymity as much as it is about um you know, having um censorship tied to a voice and censorship tied to a labeled or tagged point of view or labeled or tagged individual or voice um on the platform.
46:17
So, Without anonymity, I think the problem goes away for Twitter.
46:19
I think Twitter is working on a project, and I've been saying this for a decade, that they should let everybody pay $50 a year, $5 a month, or 30 bucks a year, $10 a month, whatever it is, to go through a verification process to make sure it's their name on the account, which by the way, Nextdoor is doing at scale.
46:36
Not only do they know it's you, they know it's your you're the person who lives at that address cuz you got a postcard there.
46:41
I think and in Korea uh South Korea, you're required to put your social security number in to open a social um account.
46:48
That would solve the entire problem.
46:51
Now, that may seem and then it would drive other users who want anonymity to anonymous platforms, and that's where Twitter it's trying to have its cake and eating it, too, and they're falling on their face.
46:59
They have one level, which is troll accounts that can do whatever the hell they want, playing on the same playing field with people who uh can and and this is just a disaster for them.
47:08
The Jim Jordan may be an idiot um and and just a loudmouth, but I think I agree with you, if the situation was reversed and we were talking about Obama being censored for some reason and the right and right-wing people or left-wing people um being silenced or deprecated on the platform, you know, soft banned, uh people would be up in arms, but it that was a different form.
47:30
He shouldn't be doing that in a censorship, and they should have a censorship committee talking about that.
47:34
What do you think, Chamath, about these two issues?
47:37
Anonymity on these platforms and the velocity in which things that outrage people, because you yourself, Chamath, went from Hold on, but I want to chew this up for you, Chamath.
47:45
this up for you, Chamath. You yourself went from being uh a perennial guest on a lot of these programs, and then now, since you've been a little bit more vocal about how you feel about social issues, when you said break everything up, who cares on CNBC, and then when you
47:58
said um who cares, let them fail, they don't get their summer happens house, you gained 150,000 followers, and now you've learned that if you're more I don't want to say the word outrageous, but if you're more vocal about social issues, you're going to gain a lot of attention. Um do you think you should have been
48:14
Um do you think you should have been labeled as somebody who is hysterical by your 500,000 people or being outrageous?
48:25
Um both and all platforms are littered with fake accounts.
48:29
Um the interesting factoid from yesterday was I think Facebook says they take down 6.
48:35
3 billion fake accounts or something.
48:38
Some crazy crazy crazy number.
48:38
So, they are paying playing whack-a-mole.
48:40
Twitter just basically says we don't have the team and the infrastructure, so we'll just let the 6 billion accounts be.
48:48
That's the only difference between Facebook and Twitter.
48:49
It's a it's a it's an acknowledgement of the problem and the transparency on the reporting.
48:54
So, um you know, look, my my point of view on this is that I think that irrespective of what I believe about free speech, I think it's becoming harder and harder for me, just as a layman, reading, to figure out what's true and not true.
49:12
Um I think that the line is getting very gray, and I think that sources that used to have complete um integrity, that were, you know, just um just beyond reproach in terms of their integrity, um it's not clear anymore because the business model of the internet is driven towards clicks.
49:34
So, I think what's actually happening is that we are dismantling um information and news and journalism.
49:43
Um the first place where I think that goes is places like Substack, which is going to rebuild it bottoms up where people will vote with their subscription dollars what to believe and what not to believe.
49:55
And then on top of that, people will overlay aggregation tools so that you can actually have multi-subscriptions and create sort of like next-generation magazines and content subscriptions or whatever.
50:07
I think that's where the That's where the world is going in terms of information and content.
50:12
Jason, my honest belief is that I don't think I've ever said anything that particularly crazy.
50:15
I just think that I'm reasonably intelligent and I'm precise in what I say and it cuts through a lot of the [ __ ] because most people have nothing to say.
50:24
So, um you know, when I make a [ __ ] investment, I write a one-pager and I post it and I'm willing to be held accountable.
50:30
You know, when I don't understand about climate change, I just post about it even though I want to invest $2 billion of my own money in it.
50:37
And so, I think uh being authentic and just being straightforward is is sort of like what is valuable at some level on the internet.
50:46
I think that governments are going to regulate these companies. Let's just be clear.
50:52
Whatever I think about censorship, it just doesn't matter what I think because governments are of a belief that these platforms craft and shape public opinion and sentiment, which drive the aggregation and coalescing of power, which fundamentally disrupts the business model of the politician.
51:12
Uh let's go swing over to Sachs here.
51:12
Uh Sachs, any comments on that censorship issue or uh the uh once very respected sources of news maybe being less respected now.
51:24
I think The New York Times came to mind when uh Chamath was sort of outlining that phenomenon.
51:31
And then we'll move on to Amazon.
51:35
Yeah, I mean I I think there are things that these platforms can do to elevate the uh you know, the the discourse, you know, the the quality of the information people are getting.
51:43
I think that um eliminating the bot accounts, I think it's a huge problem on Twitter that that it's you know, that that they're out there.
51:51
Um they're not really doing much about it.
51:52
Um I think that's something they could improve and fix.
51:56
Um you know, requiring people to to be who they purport to be, you know, I think in the this is tied to the bot issue of you know, not allowing um these sort of um sock puppet accounts.
52:06
Um so, the the but but the thing about those those steps that they could take is they're speech neutral, right?
52:13
The rules would apply to everybody.
52:14
Um you know, to Freeberg's point.
52:16
And so, I think they should look at doing more of those things, but you know, what what I'm concerned about is that um you know, so so much of the um the debate, so much of the pressure that's being brought on Facebook is to actually moderate and control the type of speech that occurs on its platform.
52:37
And um and I think the reason why Zuckerberg is is attacked more than say, you know, Jack Dorsey is because he's been more resistant to to doing that.
52:45
I I think I think it's actually because you have a bunch of what seems like real names.
52:49
But again, I think that there's a fake account issue on Facebook that's just as bad as Twitter.
52:56
It's just the difference is, you know, the the fake accounts on Facebook have proper first and last names, whereas Twitter you have all kinds of alphanumeric garbage as a as an account name.
53:04
So, here's a different proposal.
53:06
Why you know, maybe what maybe what we need is the decision that we allow complete unfettered free speech and there's a layer of both Facebook and Twitter and YouTube where that's completely allowed, but the precursor to have that access is you need to put in your social security number or something that's uniquely identifiable by your government.
53:26
So that if you say something and there's a law against you saying something, already a pre-established law, there's recourse.
53:31
Where can you go and be anonymous, Chamath, because you know On a webpage.
53:35
You can create any webpage you want.
53:36
No, but no, but I was going to say is then I think what it creates is um a decision by a user to coalesce on completely different platforms if what you want is complete anonymity for a very different reason.
53:49
And I think that that's very reasonable, too.
53:51
My point is the the solution to this, David, is diversity.
53:54
Not to have one thing and two companies try to create some Swiss Army knife Frankenstein product that solves this. It's just not possible.
54:01
And I think we're both saying the same thing, which is like you have completely different behaviors trying to go in through the same channel. It's not possible.
54:10
I actually I I like the idea of these platforms doing more to eliminate bot accounts and and uh anonymity um because the those are neutral rules of the game and they do improve the quality of the debate that occurs on those platforms.
54:24
Um I think those would be good things.
54:26
I think it's just hard to do.
54:27
I think that those companies may even want to do that.
54:29
It seems like Facebook certainly does.
54:31
It's just a hard thing to execute. not that hard.
54:34
I mean, if you just said, "Hey, listen, this account In order to have a verified account, you have to have a phone number and email."
54:39
So, that's two steps that a spammer trying to create a lot of accounts would not be able to do cuz you'd have to get burner phone number after burner phone number, which is a cost.
54:48
It's possible, but it's a cost.
54:51
And if you want to be verified, we need your phone number and we need your email address and we need you to you put in your credit card and get charged a dollar on your credit card just that we had a credit card.
55:02
Overnight Reddit would become the new Twitter.
55:04
Overnight Reddit would become 4chan would become the new Facebook.
55:06
I mean, overnight like like you know, there's to have an account, Freeberg, but to have the blue check mark.
55:11
So, you would still be able to and then over time people could say, "I don't want to see replies unless they've been verified."
55:18
And it could be just a toggle you pick.
55:20
By the way, Facebook, Google, and Twitter already have this mechanism because that's what they do to graduate advertisers up the spending curve.
55:27
You know, you can start as an anonymous advertiser just spending, you know, onesy-twosy dollars um you know, just off of a webpage basically.
55:33
Just you go through and you do self-serve ads and the more you spend or the more targeting capability you want, you graduate, you self-identify, you give more information, you get more capability back, you get more trust in the system.
55:45
So, it does exist for the customers of these big tech companies.
55:50
And this is the other big thing.
55:50
What it shows you is that it's actually solved the problem for the customers.
55:53
It just doesn't solve it for the you know, feudalist feedstock, which are the users. Because they won't pay.
55:58
And so, if you said, "Hey, listen, there's an honor system to verify They don't know.
56:04
Twitter's coming out with a paid version.
56:06
So, they're obviously on the on the halfway there.
56:09
They're going to come up with a paid version of Twitter.
56:10
Jack said it on his uh quarterly uh earnings call.
56:15
to sell I'm going to sell my Twitter stock.
56:17
Well, I mean, it's not it's not one or the other, Freeberg, though.
56:19
You you don't have to pick one or the other.
56:20
You could still be anonymous, but you have the opportunity cuz right now they're not accepting new verified users.
56:24
And unless you're a muckety-muck, you don't get to even go down that route.
56:30
So, shouldn't everybody have the ability to go down that route?
56:32
I would like I mean, I personally would like Twitter more if it verified identity.
56:36
I mean, I don't I don't think there should be a speech tax.
56:38
I don't know why they have to charge a dollar, but um but but taking taking additional means we have your credit card.
56:44
It's just another hurdle.
56:46
That's why I put it at a dollar. yeah, yeah.
56:48
You you you can do it like a $1 auth without actually charging anyone's card. Yes, you could do that.
56:53
For example, like if you if you actually force people to verify by putting in their social security number, like there's a couple guys I follow. I'll just name them.
57:00
Scott Adams, who wrote the Dilbert comics.
57:02
Um there's a guy Mike Block who I'm really not sure I understand his politics, but I follow him cuz I cuz you know, he he posts all kinds of But my point is, you know, it's it's not just people on the left, but I think it would be people on the left, people in the center, people on the right who would basically pay the quote-unquote tax because they're already real people.
57:24
And they would just they would then have more guarantees and insurances that Twitter won't be arbitrary.
57:29
And I think that makes Twitter better.
57:31
And if it maybe makes it smaller, right?
57:33
And then maybe you're right, Freeberg.
57:35
Like 4chan or 8chan or Reddit become good for a different kind of behavior.
57:40
By the way, I mean, like that's what we do today.
57:42
We don't eat the same [ __ ] thing every goddamn day.
57:45
We don't wear the same pants every day.
57:46
I agree with where he's going with that.
57:48
I mean, the the the defining feature of Reddit is that it is basically anonymous.
57:52
People have usernames, but you never know who it is.
57:56
Pseudonyms and it creates a certain kind of conversation and that's fine.
57:58
Twitter is supposed to be real people.
58:02
I mean, it's not I mean, Facebook even more so, but you know, when I think about the accounts that I follow on Twitter, um you know, it's it's you know, all of them are are real people.
58:13
Occasionally you'll get Occasionally you'll get a pseudonym.
58:18
You you'll Yeah, you'll get like um a Startup L Jackson or something like that and um you know, and I I and I think that's okay.
58:24
Yeah, but you would choose to then follow them.
58:26
The difference with like a Startup L Jackson is they're not a fake account.
58:30
They're just using a pseudonym.
58:32
And you know that when you follow them.
58:34
And over time they've proven to be to provide some value that makes people follow them.
58:38
And so, you could be anonymous.
58:40
If you get a certain number of followers, I guess you rise above the noise. Here's another solution.
58:44
There There are no um there's no nuance about truth or how much you believe this is true as a voting mechanism.
58:53
So, if you were verified on Twitter and there was a scale that says, "How true How truthful do you believe this is?"
59:00
And you could slide it uh and pick I you know, from one to five.
59:02
You could actually have another signal there.
59:04
What do you think about some sort of a signal uh to Chamath's point about uh community value saying, "I buy this. I don't."
59:10
97% of people wouldn't use it and the 3% that do would completely bias the results.
59:18
Okay, Chamath, what do you think would happen? I agree with Freeberg.
59:19
I I don't I don't think that's a It's just I don't think it's a really good idea.
59:22
Um My my my only comment was just offering The the other thing, by the way, I know it sounds crazy.
59:27
I was just offering it as like the you know, the way that this um negotiated solution will end up.
59:32
And it's kind of sort of what these internet companies are being forced to do, which are these weird, you know, pseudo action bodies that like review things and like, you know, so it's all just a slippery slope to that outcome.
59:47
But by the way, you you you were speaking about Startup L Jackson.
59:49
You know, there was another guy, Super Mugatu.
59:53
And you know, he turned out to be this, you know, really good young up-and-coming investor, Dan McMurtry.
59:59
And he was suit you know, he used a pseudonym for a long time, built up a huge audience, and then flipped himself and basically came out and said, "Here, my name is Dan McMurtry and I run a fund and you know, it was wonderful."
1:00:09
Yeah, I think it's a very good marketing strategy.
1:00:11
It's a growth strategy now.
1:00:12
Be Startup L Jackson and then you wind up becoming a venture partner. behind VC Brags?
1:00:23
Like I'm not ready to do that yet. I'm not ready either.
1:00:24
I'm not People thought it was me.
1:00:26
I was like, "I'm getting tortured."
1:00:27
Wait till you hear that I'm the guy behind Zero Hedge.
1:00:29
That'll really freak you out.
1:00:32
Well, Zero I mean, Zero Hedge is instructive.
1:00:33
Didn't he get banned or did she get banned for posting about stuff in coronavirus that eventually turned out to be acceptable and true?
1:00:42
Now, imagine if he had verified his account, he had his social security number, he had all that stuff in there.
1:00:47
Just verified, that's it.
1:00:47
Just information that says Zero Hedge is real. It's a real person. Yeah.
1:00:52
And you know, the rule is when you're that level of verified, you can publish whatever you want.
1:00:56
So you can you can say false statements as a real person.
1:01:00
So Donald Trump is a real person, he's a verified account, and he's saying things that Twitter is then determining are false or inflammatory.
1:01:05
I would rather, you know, them not try to do it.
1:01:12
And I'd rather have pundits that you can believe in.
1:01:15
So like the other problem is like look, when you have public figures, you have punditry around public figures, but the problem isn't what that person says, it's you can't believe the punditry because half of them are fake.
1:01:28
So at some point you have to break the cycle and somebody has to be real.
1:01:30
Well, and this is the problem with the the Trump issue in a pandemic is two edge cases put together.
1:01:39
And now we're figuring out what the actual cost of it is.
1:01:43
Trump said masks are [ __ ] you don't need to wear a mask, blah blah blah.
1:01:46
I choose not to wear a mask.
1:01:46
I'm not going to give people the satisfaction of seeing me in a mask.
1:01:50
Turns out masks are correct.
1:01:50
We we should have put that or should we have put in front of Trump's non-mask comments, "Hey, this is against what the guidelines are."
1:02:00
Or the fact is the WHO said, "The World Health Organization said you shouldn't wear masks."
1:02:05
Then it turns out we have a bunch of conservatives dying who didn't wear masks.
1:02:13
No, I don't think I don't think you should have put anything there.
1:02:14
Um And let all the conservatives who believe him die.
1:02:19
It's it's not about letting conservatives die.
1:02:20
I think that's a crazy way of positioning it.
1:02:21
Like he's allowed to have his opinion.
1:02:23
And really like if anything I think social media has shown that the way that we used to venerate um like veneration is sort of like it it's kind of it's been disrupted by social media.
1:02:36
Like the idea that you venerate somebody because like they won an election in a moment is so crazy because they are basically like you and in many cases may be dumber than you.
1:02:47
With respect to you know, all these ideas surrounding the idea that we need to regulate these platforms.
1:02:52
I think we should just remember that the way stuff gets into your feed is that you make the decision to follow it.
1:02:57
You know, these feeds are self-curated.
1:02:59
I mean, there is this issue about well, you know, the algorithm does sort of emphasize or sort of increase the volume.
1:03:09
And you know, we want to make sure those algorithms you know, are done in a a neutral way.
1:03:13
They're not they're not biased somehow.
1:03:14
But you know, the content that appears in people's feed is content they've chosen to see.
1:03:19
With the exception of trending topics on both platforms.
1:03:23
Well, like I said, though as long as those algorithms are unbiased and work in a speech neutral way, I think that they're fine.
1:03:30
But the you know, the the the the reason why Facebook has been boycotted is is that they they refused to censor some of Donald Trump's tweets.
1:03:40
You know, and but but you don't see those you don't see those posts rather unless you've chosen to follow them.
1:03:47
I think it's crazy that they want to ban him.
1:03:51
Problem is it's a chain of it's a chain of fake accounts and real accounts, right?
1:03:55
Let's be honest, it's a combination of both that exist on both Facebook and Twitter to amplify content in ways that none of us really understand.
1:04:04
And I would I would be very skeptical that anybody there really understands every single piece of content, how and why it gets weighted the way it does.
1:04:14
And you know, like I bet you that there's probably a way to tell whether an account is fake.
1:04:18
I mean, obviously they have system integrity tools to figure this out.
1:04:22
That's there's no way you could have eliminated 6 billion accounts if that wasn't true.
1:04:27
Um But then you know, you choose not to suppress the weighting of those or maybe you do suppress the weighting of them entirely.
1:04:32
It's just an all too You're talking about but but in terms of implication, okay, so maybe maybe you can game the trending topics that way.
1:04:40
But you can't get in my feed unless either I choose to follow you or you you pay to you know, run an ad which my eyes are just trained to skip over.
1:04:52
Um So I you know, I I I think if you were to ask the average person, do you believe that you are um sort of um influenced by deceptive content on Twitter and Facebook or you're sort of unduly influenced they would say no.
1:05:06
You know, none of us believe that we are.
1:05:11
But then if you ask But if you if you said, "Do you interact in groups and forums with a bunch of people that you don't know?" The answer would be yes.
1:05:21
But what I'm saying is that the average person doesn't believe that they're unduly influenced.
1:05:23
But but if you ask them, "Do you think other people are?"
1:05:26
they would say Yeah, I get it.
1:05:26
Of course like it's like you know, when you're having a [ __ ] Slurpee, it's like you know, do you think that this is unduly going to hurt you? No.
1:05:35
It's 1,200 calories of liquid sugar.
1:05:35
All right, I think we beat this horse to death.
1:05:39
There's no solution just on the edges.
1:05:41
But let's let's go to Amazon cuz I thought that this was a particularly interesting one.
1:05:45
Amazon I thought came out the best of everybody and is the least likely to be broken up.
1:05:52
I think some of you agree with that.
1:05:54
What were your impressions on Amazon's performance and Amazon in terms of being broken up?
1:06:01
Let's start with you, Friedberg, and then we'll go back to Chamath.
1:06:04
I think the intention of antitrust laws obviously is to protect consumers and protect markets and protect market pricing from being manipulated by monopolists monopolies.
1:06:13
And so you know, the the the the point that was made about Walmart years ago is the same point that's being made about Amazon today, which is that they're crushing small local businesses.
1:06:26
And as a result, there is a lot of damage being done and they are quote-unquote too powerful.
1:06:31
But the reality is that the the pricing effect of what they're doing is what needs to ultimately be scrutinized and I think is what will ultimately drive whether or not these guys have either some massive penalty or get forced to break up.
1:06:45
And so you ask yourself the question, look, if I'm going to buy call it a mattress or let's let's use something like a pillow.
1:06:51
Is it cheaper for me to buy that pillow as a consumer through Amazon or from the local store?
1:06:57
Now, what if the local store is put out of business because of Amazon?
1:06:59
And now Amazon is the only place I can get a pillow.
1:07:03
Is the pillow now going to be more expensive or less expensive than it would have been otherwise?
1:07:08
And I think that is the lens by which we need to kind of assess and the regulators will ultimately assess whether or not Amazon is causing harm in the marketplace because of its position and its power. Friedberg.
1:07:20
Look, I have several businesses that sell on Amazon.
1:07:25
And it is [ __ ] expensive.
1:07:25
One of my companies I'm on the board of, we we've been the number one food product on Amazon multiple times.
1:07:31
We we kind of slide up and down the top 10.
1:07:34
Can you say what that is? Yeah, Soylent. Soylent.
1:07:38
And so we sell a lot of Soylent on Amazon.
1:07:41
And it is expensive, man.
1:07:42
I mean, the fulfillment, the shipping, the advertising fees they force you to pay.
1:07:49
I will tell you that as a business owner or board member of a business that sells and I have several others that sell on Amazon, too. It is a it is a grind.
1:07:54
And it is cheaper for us to sell directly through Shopify.
1:08:01
don't you just raise the price on Amazon?
1:08:04
So to some extent, so Amazon This is actually part of the problem.
1:08:07
So Amazon forces certain best pricing negotiations if you're a large seller on Amazon.
1:08:12
You have to make sure in order for them to promote you and make you kind of a sponsored item and show you at the top of the list, you have to give them the best deal.
1:08:19
Sort of like what Walmart does, right?
1:08:21
You can't have a cheaper price anywhere else. Got it.
1:08:24
So that was something that did not come up.
1:08:26
They force you to have the best price there even if you charge more on your website.
1:08:31
In these negotiated deals.
1:08:31
Yeah, and so you have to make sure that you're providing um and I'm not sure what the deal is specifically with Soylent.
1:08:37
So I don't want to kind of speak incorrectly here.
1:08:40
No, I heard the same thing from other folks.
1:08:42
What if Soylent of part of what happens.
1:08:43
And so I will tell you like it it is harder for it is cheaper for me to sell Soylent I I think it's cheaper for some of these products to be So I can tell you my other company which we sell quinoa, it's cheaper for us to sell through retail stores than it is to sell on Amazon.
1:08:58
We actually give up more margin selling on Amazon than we would otherwise.
1:09:02
Because of the volume and because they've aggregated all the consumers.
1:09:05
made the decision as an entrepreneur to sell your quinoa in all places even though you lose some margin, you make it back in aggregate.
1:09:12
Well, this this goes to the market the market problem.
1:09:13
Well, this goes to the market problem because now I as a I have less choice as a business owner because the only place I can find consumers is in this online marketplace called Amazon.
1:09:23
I can no longer go sell at 50 local grocery stores because people don't go to the freaking local grocery stores anymore.
1:09:28
And that's obviously a little bit of an extreme statement, but let's say I'm a pillow guy.
1:09:30
I can't go sell at 50 pillow stores, cuz they've all been shut down, cuz all the consumers go to Amazon.
1:09:36
you also sell at Target and Walmart and those other competitors who seem to be doing just, you know, pretty well, actually? They're doing well.
1:09:41
Yeah, and and a lot of people have said that they're the kind of, you know, the exceptions, but there's a thousand versions of Sears and other stores that haven't done as well.
1:09:49
Walmart and Target just happen to be extremely well-run businesses, but there's nothing fundamental about those businesses.
1:09:56
kicked you off the platform and said, "We're not going to allow third-party sellers."
1:09:58
Would you be happier, or would you be sadder? We would be sadder. Got it.
1:10:01
Chamath, what are your thoughts? Amazon specific.
1:10:07
Yeah, I think David said it really well up front, um which is that it's a it's kind of a when and not an if.
1:10:12
So, it's, you know, Amazon today, I don't think is at risk, just because its end market is so big, but I think within 5 or 10 years, um it definitely will be looked at through the same lens as Facebook and Google and actually the just those two.
1:10:32
Um Look, and I and I think David said it also really well, like the antitrust law that you would get, um you know, to be successful if applied to Facebook and Google, has nothing to do with users and content, and it has everything to do with the pricing of the ads to their customers.
1:10:48
And if anybody actually were smart enough to figure out whether there was some way in which their auctions were working um that was effectively pricing inventory in a market, quote unquote, or in a system manipulated way, that's probably the best hook to to nab one of these folks in antitrust law.
1:11:06
But other than that, it's going to be regulation.
1:11:10
In terms of Amazon, I think they're going to get away unscathed.
1:11:11
What's incredible, by the way, is, you know, 2 days later, they're like, "Hey, by the way, we just got an FCC license, and we're going to launch a $10 billion satellite constellation."
1:11:19
And you know, if you if you looked at their RFP to to the uh to the FCC, the number of people that, you know, basically complained and cried, it was incredible.
1:11:30
By the way, I think this is a huge important point that we haven't made, which is the benefit of scale for large innovative companies.
1:11:38
There is no way any company would have out of the blue been able to afford a $10 billion distributed satellite program without having customers and all this other stuff lined up.
1:11:47
Amazon can afford to take that risk, just like Alphabet has taken the risk with self-driving cars and did so before anyone else for many years.
1:11:54
a net benefit for society, correct, David?
1:11:56
a net benefit for society.
1:11:56
So, by having scale, by having incredible profits, by and then by reinvesting it in R&D, creating jobs, innovating, it's the only way this kind of stuff is going to get done.
1:12:05
You're not going to get it done by breaking up these companies and having a hundred companies that only have $10 million of profit each, and then each of them are, you know, no one at all can afford to do these grand important projects that that move markets forward.
1:12:18
Ultimately, for humanity, Freeberg, you see these trillion-dollar plus companies as because they can make those big swings, a net benefit for humanity.
1:12:24
As a technologist and as a kind of person that hopes for the future, I hope I hope that they that that these sorts of companies can continue to persist, and that they're led by people that want to take innovative risk with R&D dollars.
1:12:41
And by the way, if they don't, they're going to [ __ ] fail eventually, right?
1:12:44
It's these guys that are leading these companies and and putting these crazy bets on crazy new ideas that are allowing these businesses to remain competitive.
1:12:51
Um and if they didn't, and, you know, some big company manager were to come in and start running these things and distributing cash and dividends back to shareholders, these wouldn't be happening, and and, you know, capitalism would take care of itself, and then the next big innovative risk-taker that can generate a profit and reinvest that profit in a smart way would end up winning in the marketplace.
1:13:11
So Uh Sachs, you are a big investor in SpaceX at Craft Ventures, I understand.
1:13:18
Uh and when you see Bezos copy every single thing Elon does from, you know, launching the rockets to then putting up the satellites, do you think he's just a copycat?
1:13:30
Well, I you know, I I think he's the scariest monopolist out of the the whole bunch.
1:13:34
Um you know, if you look at kind of Amazon versus, say, Google or Facebook or Apple, I mean, those other companies are sort of sticking to their original footprint, whereas Amazon keeps expanding into new areas.
1:13:44
Um you know, it's that that whole mantra he has about your profit is my opportunity.
1:13:49
And so, yeah, with each uh you know, with with each advancement that they make as they get into, you know, as they get to a new level of scale, they then turn around and uh and seek to take over kind of um the the you know, the areas that um that their vendors or business partners are operating.
1:14:08
And so, you know, it started with first they did retail, you know, books, and then they expanded to other areas of retail, and then they take over um infrastructure, and now there's talk about them getting into to freight or trucking.
1:14:19
Um and so, yeah, they keep expanding into these new areas, and it's it's really a statement of about our politics.
1:14:25
I agree with Chamath that that Bezos went pretty much unscathed, and I think it has a lot to do with, you know, he did win the internet with that opening statement that he gave.
1:14:33
It was a really um sort of great, you know, rags-to-riches, only in America type story.
1:14:38
And um and so, I think I agree with Chamath he's going to get away pretty unscathed, but I I do think that they're they are the scariest monopolist of the bunch.
1:14:48
What comment specifically on him copying every one of Elon Musk's ideas?
1:14:54
Well, you know, uh copying is it's it is it is sort of a part of the game, you know, it is part of the game.
1:15:01
And I've I've heard you attack Zuckerberg for doing the same thing.
1:15:03
And, you know, look, I I get it.
1:15:06
You know, we we we prize uh innovation, and we we we love innovators.
1:15:11
Um but as soon as you say that you can't that other companies can't copy those innovations, you do stifle progress, and I look at it as more how consistently you do you do that as your playbook.
1:15:24
When you look at uh Amazon Basics, this is the point I wanted to make when I and I made in my my earlier podcast, which was, you know, the Amazon Basics and the third-party seller system is the thing that uh they keyed in on on these hearings.
1:15:39
They did not key in on uh the issue of that Freeberg brought up, which was, what is the margin they're taking from those third-party sellers, which I think would have been a much more deft uh approach to questioning them.
1:15:52
But when it comes to third-party sellers, the fact is, they're allowing people to compete with them on their own platform, which drives prices so low.
1:16:03
And when they make a better USB-C cable, that doesn't take a genius to make a better cable.
1:16:08
So, do you think Amazon Basics should be allowed and is great for humanity, or do you think that that uh using of the data, cuz they have the sales data on it, is in some way abhorrent and a problem, given the way antitrust laws are currently framed for uh Sachs?
1:16:29
Well, okay, so uh I think this is an area where So, the the area you're talking about is the way that these platforms treat the applications or small businesses that operate on their platforms.
1:16:39
And I do think this is a a good area for for Congress to keep scrutinizing.
1:16:44
Um You There's There's a saying in in in chess that that the threat is greater than the execution.
1:16:51
So, sort of a chess strategy principle.
1:16:53
I think that's true here, where um we I I I think the execution would be a disaster if we actually impose a lot of these rules, if we broke up these companies, if we stopped Amazon from innovating.
1:17:04
I think that would be a disaster for uh for for those companies and for the economy, cuz I do think they they do a lot of good things.
1:17:11
But in a weird way, I think we have to keep threatening to to do those things in order to get these companies not to do anti-competitive things.
1:17:20
I mean, we heard Bezos say that he couldn't guarantee that they weren't using their uh their their sellers' data to to to to inappropriate ways.
1:17:31
Basically, Amazon to to break Amazon's own policy.
1:17:33
And so, I think you do have to apply this kind of scrutiny to these companies, uh because I I don't think we want to be retroactively uh you know, remediating a situation.
1:17:41
I don't think we want to be breaking them up or doing something like that.
1:17:45
But I do think we want them second-guessing these anti-competitive decisions before they actually happen.
1:17:50
Um because otherwise, So, some some rules, but we certainly don't want to ankle them versus their competitors in China.
1:18:00
As we wrap up here, cuz we're getting way past our hour.
1:18:03
We're now at 80 minutes, and we said a max of 90 here was what we all agreed on.
1:18:07
Um I want to talk about the election.
1:18:10
We are now at the 100-day mark.
1:18:12
We all thought Biden was a shoe-in.
1:18:16
Now, I have my own thesis.
1:18:16
I want to float it and see what you guys think.
1:18:18
Um you had Trump start wearing a mask last week, telling everybody they should wear masks.
1:18:26
Now, there's universal discussion of wearing masks.
1:18:29
We've got a little bit of vaccine hope, and I will get to Freeberg's position on is that vaccine false gold, or is it actual reality.
1:18:37
But we know that masks are going to take three or four weeks uh if they're implemented properly for us to see the case load go down, which then the case load starts going down, and three or four weeks after that, the deaths would start going down.
1:18:49
We may have even seen a little plateau in the number of cases. Cases is ramping up.
1:18:53
a record 850 or 900,000 just yesterday, at the time of taping, I think, on the 29th of July.
1:19:01
Now, my thesis is, Trump goes all-in on masks.
1:19:06
The vaccine starts to show promise right as the debates start.
1:19:10
He gets in there with Biden.
1:19:13
We see case loads go down. We see deaths plummet.
1:19:16
We get down under 250 deaths per day in America.
1:19:23
By September 15th, the market rips and on Sep- end of September we have the first presidential debate.
1:19:27
Biden dunks on a senile or maybe not crisp Biden.
1:19:35
Trump sails in and we were just talking 2 months ago, anything could happen but Trump was definitely not going to be there.
1:19:40
Let's go around the horn.
1:19:42
Friedberg, vaccine false gold or really promising and what happens in the election?
1:19:50
I think there's tons of promise with vaccine news in the next 2 months, uh 3 months.
1:19:57
Uh I guess the point is you're going to hear more upside than you're going to hear downside news on vaccines, uh for sure.
1:20:04
You know, whether or not we have a vaccine and by when and yada yada and how much chance we have a vaccine?
1:20:09
We're going to have a vaccine.
1:20:09
I think it's a function of how many doses, um at what point in time, um and you know, there there is this 30,000 trial happening with Moderna right now.
1:20:20
There's a a Russian vaccine that just got approved yesterday in Russia that they're saying is ready to go and they're starting to distribute it.
1:20:26
So, there is a vac- there are vaccines, right? This is a a known known.
1:20:30
Uh so so that news will only continue to improve and build and there'll only be more and more indications of success with vaccines between now and and November.
1:20:38
How that affects markets, I think I'm not sure that drives markets as much as some of the other stuff that's going on in markets with uh with the Fed and um and with policy and with packages, I think those are are frankly um important drivers right now.
1:20:54
Uh and how much the markets ultimately affect the election, I don't know.
1:20:58
Um So, uh yeah, it's still it's it's all still pretty uncertain. Um Who's going to win?
1:21:06
I think it's pretty uncertain.
1:21:06
I I'd I'd say Biden right now.
1:21:09
entire net worth on one person. Go.
1:21:13
Um Yeah, I I I I still think Trump is um I I I I kind of have been uh vacillating on this.
1:21:20
I I think Trump is probably uh only going to improve from here on out.
1:21:26
So, your entire net worth is on the line in 3, 2, place your bet. I'd go Trump. Wow. Wow.
1:21:35
it's it's still it's still to me I mean, Trump is is got to be the huge underdog here.
1:21:38
I mean, right now it looks like Biden's going to win.
1:21:40
I mean, his basement strategy could backfire in the sense that if, you know, fundamental conditions improve with respect to COVID or the economy, the fact that he hasn't done anything, done anything, gone anywhere, um you know, it it it it could it could turn out to be a mistake.
1:21:54
But right now, it it looks like it's working and um and you know, Trump seems to be completely knocked off his game.
1:22:02
Um you know, just earlier in the week he floated this trial balloon about delaying the the election.
1:22:07
That was completely shot down by um Republicans.
1:22:13
And it seems like what did you think as a Republican?
1:22:14
When you saw him tweet that, what did you think?
1:22:17
What was your emotional visceral reaction as a Republican?
1:22:20
You know, I'm not uh yeah, I I I don't I don't necessarily identify with with partisan politics.
1:22:24
So, let me just I have to state that.
1:22:27
What was your reaction as an American to him saying delay the election?
1:22:30
Everybody Everybody shot down for reaction.
1:22:33
Everybody shot it down for good reason. Your reaction, Sachs.
1:22:37
Of course, we're not going to delay the election.
1:22:39
We've, you know, um you know, we we we haven't delayed the we didn't delay the election to to fight He's so scared of being pinned as a Republican.
1:22:47
He's It's not going to [ __ ] with your deal flow, Sachs. You can be a Republican.
1:22:53
Okay, your entire net worth, we have to wrap.
1:22:55
Your entire net worth, Sachs. You could right now. 3, 2, net worth.
1:23:01
now it looks like Biden's going to win.
1:23:02
Trump's Trump's been knocked off his game.
1:23:03
And And let me me to say like I I think the the problem that Trump has right now is he's a salesman without a sales pitch.
1:23:10
Um you know, you you go back to the State of the Union pre-COVID.
1:23:12
He had it all worked out.
1:23:13
He was going to run on the greatest economy ever, keep America great.
1:23:17
That issue's been taken away from him and it seems like he's still trying to regain his footing.
1:23:21
He's trying to figure out what to run on.
1:23:23
And the fact that he can't do these rallies, which were really, you know, the fact that he was able to go in 2016 to these swing states, he would be, you know, flying around on his plane and and and you three he did three rallies a day in these swing states with tens of thousands of people. it. He wanted to win.
1:23:40
It was it it was it was that and it gave him a way to go over the heads of the media and speak directly to the people and then those people talked to other people.
1:23:47
There's a lot of word of mouth.
1:23:48
Um and so he the inability for him to hold those rallies, I think it's just been um devastating for the type of campaigning that he likes to do.
1:23:57
And so, in a weird way we have less than 100 days to the election, but it feels like the campaign hasn't really started yet because Trump can't do rallies and Biden hasn't left his basement. Okay, Chamath.
1:24:10
Entire net worth on the line. All SPACs.
1:24:13
SPAC B, SPAC C, SPAC D, whatever you got SPAC'd up.
1:24:18
All your SPACs on the line. Everything. The Warriors position. 3, 2, net worth.
1:24:22
We don't need to guess, but I'll tell you why.
1:24:28
Um you know, uh we had a 33% drop in GDP.
1:24:30
We have double digit unemployment.
1:24:34
And I think Trump's real path to winning the White House, which we talked about before, was getting an enormous stimulus bill passed and he didn't force the Republican Senate to the table to make sure that these unemployment benefits didn't roll off.
1:24:51
Now, there's a very practical problem with these unemployment benefits, which is that it is not administered at the federal level.
1:24:59
It's administered by literally 50 state agencies that run relatively decrepit software.
1:25:04
Now, just so you guys know, why do we pick $600?
1:25:06
It was an estimated numerical average because what the Republicans really wanted to do was just top it up.
1:25:14
You know, whatever you used to get to get to 100 and it was technically not feasible to implement across 50 different Right.
1:25:20
So, somebody in Boise, Idaho is different than somebody in New York.
1:25:26
So, they they were like, "Ah, 600 bucks."
1:25:28
So, my point is uh it's going to take 4 to 8 weeks to re-implement unemployment insurance once we decide what we're going to do.
1:25:36
So, that basically, if you started today, puts you somewhere between September 1 and October 1.
1:25:43
And the you know, so you have then 30 days to basically catch a positive tailwind or 60 days.
1:25:49
So, call it midpoint 45 days.
1:25:51
You know, you have now federal eviction laws that are rolling off.
1:25:55
So, I think that it's setting itself up for a diff- very difficult path.
1:26:00
Um he just stopped spending, I believe, in Michigan, Trump did.
1:26:05
Um which is, you know, not a good sign.
1:26:08
Um he actually has overspent in Georgia.
1:26:11
Um so, if you look at the facts on the ground, Your entire net worth goes on? No, it's Biden.
1:26:18
It's a it's a languishing campaign as of today. David is right.
1:26:22
He's a salesman without a pitch and unfortunately, he's a the path isn't clear.
1:26:27
The path should have been paved with money. It's such a no-brainer.
1:26:31
Here, let me let me give you one last poll.
1:26:34
that money, too, and why would you stop printing the money?
1:26:38
If you gave everybody $1,200 and 6 weeks of unemployment, why not just do it for another 6 weeks and give everybody another 1,200?
1:26:44
I don't understand why that's such a difficult decision for Trump. Friedberg, go.
1:26:47
Let me give you a scary poll that just came out by YouGov.
1:26:51
It says um 55% of supporters of Donald Trump say that they will not accept the election victory of Joe Biden if mail-in uh votes are are are allowed. Wow.
1:27:03
So, you know, the the framing of this is actually a little bit more serious than just who's going to win.
1:27:07
There is a further polarization, constitutional crisis question, rioting, you know, whatever, disregard for the election entirely kind of moment coming up here because Trump and others have kind of framed this as such a non-election election because it's all fake and it's all fake news and it you know, this is all part of the conspiracy.
1:27:26
So, there is something scary brewing, I think.
1:27:29
And that that's what I'm kind of most interested in tracking is really where does this all go?
1:27:35
Percentage chance that we get to a constitutional crisis and Trump says I'm not leaving the White House on a percentage basis, Friedberg.
1:27:42
I don't think he'll say I'm not leaving the White House.
1:27:44
I think he's going to be [ __ ] happy to go back to wherever he's going to go.
1:27:47
Um yeah, but I think it's it's it's I think there's going to be other ramifications that are worth us figuring out and thinking about because that's the scary stuff that's coming next. Okay.
1:27:55
That's a good 25% chance of a constitutional crisis.
1:27:57
I think if the election's close, we could easily have like a Gore v. Bush type situation.
1:28:03
Um it could be very damaging for for the republic.
1:28:05
I do not think there'll be a hanging chad issue in this election.
1:28:09
This is going to be one way or the other incredibly decisive on an electoral college level.
1:28:14
Okay, final Final It's not set up for it to be that that close. Okay.
1:28:19
I I don't think the election is Right now it's not trending to be close at all.
1:28:23
It's trending to be a blowout.
1:28:24
And so, I think we'll avoid the the crisis because it's not close and it looks like Biden's going to run away with it.
1:28:29
But if it does get super close, um you know, I could imagine there being a crisis based on people not accepting the If the margin of error is within the margin of these mail-in ballots and you have, you know, 30, 40% of the population saying they're not going to accept it, um I'm I'm not saying we'll have like a legal crisis, but I think you could have a legitimacy crisis.
1:28:49
It could be very bad for the republic.
1:28:53
Uh not as bad as Trump's presidency, clearly.
1:28:55
Uh so, uh final question, final final question.
1:28:59
If Trump believes he's not going to win and he's essentially given up right now, which it feels like he's kind of given up, what would do you think who would win if Trump says, "Nikki Haley and Pence can run.
1:29:11
I've done such an amazing job.
1:29:11
I've been the best president in the history of the Union, but I want to get back to my life and I think Pence, Nikki Haley should go for it.
1:29:20
What happens and who wins? Sachs. Too late for that? It's too late for that.
1:29:25
You can't You can't put Pence and Nikki Haley on the ballot. Why not? Of course you can.
1:29:28
If he says, "I'm feeling under it."
1:29:33
If he bows out, the Republicans would have to pick a successor.
1:29:35
It's not a new third party.
1:29:37
The Republicans would be allowed to pick a successor.
1:29:40
If he said, "I'm not doing it for uh you know, health reasons."
1:29:43
Whatever the reason he comes up with. Who wins? Nikki Haley? No. Too silly?
1:29:49
I think he might drop out.
1:29:49
I think there I'm putting it out there.
1:29:51
I think it's a 5% chance he doesn't want to be demolished and he says, "You know what? I'll take the deal.
1:29:56
You agree to not prosecute me getting out of here.
1:29:58
Uh I'll take it and and I changed I changed my bet to Joe Biden. I've changed my bet.
1:30:05
After this after you risked your whole net worth, you changed to Joe Biden?
1:30:08
Well, he's he's clearly the favorite right now and the question is whether there's still time for there to be a change.
1:30:14
I mean, honestly, I think we should stop betting on what the outcome is. I think it's stupid.
1:30:16
I think what we were should really be worried about is what what are we doing like letting tens of millions of Americans roll off of unemployment insurance with zero like the Republican Senate went on vacation. It's ridiculous.
1:30:34
I mean, they should all be fired.
1:30:35
It's It's the craziest thing.
1:30:35
We have the biggest crisis in our lifetime.
1:30:41
If you roll up the last three crises, 9/11, dot-com bust, and the Great Recession, those three pale in comparison to the magnitude of this one and these [ __ ] are going on vacation. I agree with you. It's outrageous.
1:30:53
I I don't think partisan politics are that interesting, but um I I think they will eventually pass a bill.
1:30:58
I think um the the the issue on the unemployment is not that the Republicans don't support an extension of unemployment, but the the magnitude of the unemployment now um exceeds what workers would get if they went back to work.
1:31:10
And so, I think they're concerned about creating a disincentive for for workers going back to work.
1:31:16
Why not split the not make it $300?
1:31:19
Honestly, there's such fake [ __ ] news.
1:31:20
Like it's like it has been shown that people then end up spending that money.
1:31:24
Like I don't know if you guys saw, but like there are industries that are posting It's not just Facebook, Amazon, and Google posting meat and beats like you wouldn't believe in boating, in housing.
1:31:34
People are spending this money. It drives GDP.
1:31:37
So, whether you put 600 or 200 or 1,200 into people's pockets, they have a proclivity to spend it.
1:31:45
They should have gotten something done.
1:31:47
Trump Trump as well as all the Republicans are up for re-election, I think, would just cave on this issue.
1:31:52
And I I I think it will get done.
1:31:52
The The Republicans who are opposing it are the ones who aren't up for re-election and are concerned about debt.
1:31:59
You know, that's the that's the that's the concern that all of a sudden people have.
1:32:05
if we go into a depression, David?
1:32:05
Why not the incremental 6 weeks of unemployment?
1:32:10
Put it at $300, but get something done, David.
1:32:12
Why are you not getting something done, David?
1:32:17
Why is your team [ __ ] this up, David?
1:32:20
Yeah, I don't I don't wear a jersey. I'm not on a team.
1:32:24
But I I think they will get something done.
1:32:25
I mean, I'm not I'm not defending this.
1:32:27
do you think they should have gone on vacation? They're gone.
1:32:30
They're on vacation, David. They can't.
1:32:31
They got to come back to work.
1:32:33
These guys went duck hunting instead of taking care of the 15 million.
1:32:36
Your team went duck hunting. D. C.
1:32:42
Obviously, there's a lot of There's enough Republicans who want to get something done.
1:32:44
I mean, why not blame the Democrats for being too intransigent?
1:32:46
Sorry, what I'm saying is it's not Republicans.
1:32:48
I'm saying the entire Senate is We're breaking your chops, Sachs.
1:32:51
The The entire group should not have gone on vacation.
1:32:55
The entire half half of half of the Congress is gone. They're not to be found. Where are they?
1:33:03
What What are they doing that's more important?
1:33:05
Maybe they're hanging out in their basement like like Biden. I love you guys. All right.
1:33:09
Everybody stay safe uh on behalf of the dictator himself, Bestie C, the the uh SPAC Meister himself, stay safe, Chamath.
1:33:18
On behalf of the queen of quinoa, the Friedberg himself, uh stay safe, David Friedberg, uh in whichever one of your three houses you're in right now.
1:33:31
And And to Rain Man, he's definitely B- Burn that don't burn, baby.
1:33:41
He's definitely a great driver in the driveway. Yeah. Yeah. Yeah. Definitely still Yeah. Yeah. Yeah.
1:33:47
He's definitely investing Wapner. Wapner.
1:33:49
And of course he has the fish sticks.
1:33:51
And of course he's still investing from Kraft.
1:33:52
Certainly Kraft funds still investing.
1:33:54
We'll see you all next time on the sixth most popular podcast out of the gate. Let's see.
1:34:01
Maybe if you tell your friends about this podcast, we'll go to number one on the technology list. Uh love you boys. Stay safe.
1:34:06
Can't wait to play poker. Bye. Great job, everybody.